Posted To RWER Blog Regarding Positive Money’s Proposal To Return Money Creation To The State

E:  All of the interest extracted from the money supply for the interest payment is effectively restored to the money supply, by a variety of routes.

Me:  This is not true even under the most ideal circumstances or conjectures. Money pooling, rentiering, ever rising depreciation costs, and numerous other moment to moment extractions of the flow of money from the economy like re-investment of savings and profit back into the economy introduce time lags/flows and flows of additional costs to the economy. Add to this the increasingly disruptive and erosive effects on aggregate demand of technological innovation and AI and also the entirely obvious outsized revenue of the business model of finance and it should be obvious that the only actual solution to the mess of the current paradigm of Debt Only is the new financial, monetary and economic paradigm of Direct and Reciprocal Monetary Gifting.

Positive Money’s idea of returning monetary sovereignty to the state is an essential first step. Then one needs to find the policy means of thoroughly integrating Monetary Gifting into the economic system, and finally recognizing the concept/ethic/zeitgeist behind even the new paradigm so as to have a sufficient ethical guide for the continuance of the new paradigm and for curbing both the private and public vices inherent in the old one.

Me:  The real distinction and significance that is not being comprehended in economics and monetary theory is the actual moment to moment problem lies in the scarcity ratio of total INDIVIDUAL INCOMES to total costs/prices NOT TOTAL MONEY in the system, and that finding an integrative economic way to invert and transform that ratio is not only key to fixing the problem but to creating the new paradigm.

Also, the trick is to try to be continually open, affirming and integrative about economic reforms. As I have said here I agree with 99% of what the heterodox economists say here. My problem is they do not seem to be aware of how to implement their largely accurate critiques.

Double entry bookkeeping being the underlying moment to moment micro-economic infrastructure for all commerce, the sales/macro-economic aggregation points throughout the entirety of the economy and also a digital system where equal debits and credits sum to zero makes it the perfect system and means for inverting and transforming the above seeming problematic monetary and economic ratio with the discount/rebate policies I have posted here, and makes their temporal monetary and economic effects simple, elegant and powerful. Once you see it and how it cuts through all of the correctly identified complexity of the economy the normal reaction is…how did I not see this? The answer of course is if you do not look in the right place and think economically….you do not perceive and recognize solutions.

 

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